US stocks dropped on Friday, pulled lower by a selloff in consumer discretionary stocks as bellwether names Amazon.com and Ford Motor fell in the wake of their quarterly earnings.

Amazon was the S&P 500's worst performer, down 9.9 per cent to $US303.83, and other high-flying sectors dropped along with it. Social media names slid, with Twitter losing 7.1 per cent to $US41.61, and the Nasdaq Biotechnology Index falling 2.4 per cent as investors once again shied away from riskier sectors. The Global X Social Media index ETF tumbled 5.3 per cent, its second-worst performance since its debut in November 2011.

Still, even with Friday's decline, the S&P 500 finished nearly flat for the week. The benchmark index remained within 2 per cent of its all-time intraday high.

Amazon's stock declined a day after the company reported a jump in quarterly revenue, which was offset by sharp increases in spending.

Ford Motor shares fell 3.3 per cent to $US15.78 after the No. 2 US automaker reported first-quarter earnings that missed expectations. The company's results were hurt by higher warranty costs in North America.

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The two weighed on the S&P index of consumer discretionary stocks, which dropped 1.7 per cent and ranked as the worst-performing sector of the day.

"What that says is people are using any strength at all to raise some cash because they think the market is going to test lower," said Ken Polcari, director of the NYSE floor division at O'Neil Securities in New York.

Investors continued to pay attention to geopolitical strife over Ukraine, creating some nervousness heading into the weekend. US President Barack Obama and four European allies agreed on Friday that Russia failed to live up to terms of the Ukraine peace accord, and would coordinate on a response to "impose costs" on Russia, the White House said.

While the situation has taken a backseat to corporate earnings recently, investors remain on edge over the possible result of escalating tensions. Visa Inc said late Thursday that US sanctions on Russia were hurting its card transaction volumes. Visa's stock dropped 5 per cent to $US198.93 and weighed on the Dow.

On the upside, Microsoft's earnings topped analysts' forecasts, while investors were cheered by the software company's new emphasis on mobile and cloud computing. Microsoft's stock edged up 0.1 per cent to close at $US39.91.

The Dow Jones industrial average fell 140.19 points or 0.85 per cent, to end at 16,361.46. The S&P 500 dropped 15.21 points or 0.81 per cent, to 1,863.40. The Nasdaq Composite tumbled 72.777 points or 1.75 per cent, to 4,075.561.

For the week, the Dow fell 0.3 per cent, the S&P 500 dipped 0.1 per cent and the Nasdaq lost 0.5 per cent.

While companies are clearing a lowered bar for earnings, estimates have been improving. Profits are now seen rising 3.3 per cent this quarter, down from the 6.5 per cent growth rate estimated at the start of the year, but above the low of 0.6 per cent seen last week, according to Thomson Reuters data.

Healthcare names were among the biggest gainers after LifePoint Hospitals Inc's results. The stock advanced 6.3 per cent to $US56.87, while Tenet Healthcare jumped 9.1 per cent to $US46.11 and Community Health climbed 6.6 per cent to $US39.92.

In the latest economic data, US consumer sentiment rose to a nine-month high in April, according to the Thomson Reuters/University of Michigan index. But the US services sector expanded at a slower rate.

Volume was modest, with about 6.26 billion shares traded on US exchanges, slightly below the 6.57 billion average so far this month, according to data from BATS Global Markets.

Declining stocks outnumbered advancing ones on the New York Stock Exchange by a ratio of 2 to 1, while on the Nasdaq, five stocks fell for every one that rose.